Archive for May, 2010

Abstract: Plutocracy has caught American society in an overwhelming web. Pernicious concepts and tools have been engineered by financiers and economists to justify its rule. The credit rating agencies are a famous example: they, and their plutocratic owners (Warren Buffet) rate the privates who pay them (but the governments do not pay them, so raters can rate them according to whether their private clients are long or short, the example of Greece and Goldman Sachs, also a Buffet property, a case in point).

Economic concepts such as GDP, productivity, PPP, the very basics of measuring economic performance objectively, are grossly biased. But always in the same way.

Price Purchase Parity, PPP, was invented mostly, in its present nature, to prove to the increasingly suspicious masses, that American plutocracy is best. GDP, itself biased, was not biased enough, in the eyes of the plutocratic masters. So the little economist robots functioned as wanted, and biased the bias some more, until masters were pleased. I am not saying that the concept of PPP could never work. But, as it is, it works only for the owners of the USA, and the obsessively materialist world they want us to live in.

As it is PPP belittles the economic achievements of other countries. PPP excludes services, hence health care, education, welfare, and general services (such as child care, public transportation, smart web and very high speed trains). Instead the existing PPP favors goods, thus consumption, and the more frantic the better. It judges a man’s happiness by its stomach. Existing PPP blossoms with debt, the way most of the money is created in the USA (by private bankers funded by the state in several ways, some secret, some blatant). Too much debt served, that’s called serfdom. Debt can destroy democracy: that is how the average Frank ("Free") became a serf, over a few centuries, in the High Middle Ages.

Even leftist "opponents" embrace many an erroneous basic economic tool (as I show by deconstructing my preferred self conscious economic robot once again).

***

***

DISINFORMATION EVERYWHERE:

Let’s recapitulate first the biggest absurdity of the American economy in the last two years (and thus the absurdity of economic and financial theory when reduced to the cult of greed). Citizens of the USA were programmed into believing that nationalizing the so called financial "institutions" was "not-American". So what happened?

PEOPLE WERE NATIONALIZED BY THE BANKS:

Five corporations controlled by the rich constitute the U.S. mainstream media: there used to be around fifty independent news organizations in the early 1980s. No wonder people think all the same.

The right screams that Obama nationalized the banks, and that this is "un-American". The left says that banks could never be nationalized, because this will not fly in America. Both are sure of their opinions, both are wrong.

Verily, the nationalizations were paid for, but without acquiring title. The Obama administration, like a deer in the headlights, chose the middle course, the middle of the road, a place of wisdom, according to deer in headlights. Obama was being fed delicious poisonous advice by the wolves surrounding him, his "friends" Summers, Geithner, Dimon, Buffet, the agents of Goldman at the White House, etc…

Those worthies thought they could foil everybody. And, so far, it has worked, because opinion makers have been thoroughly confused, or have been in the position to claim they were thoroughly confused. The insistence that it was all the fault of little people who had defaulted on their mortgages, masked the reality that the largest hedge funds in the world were the publicly financed private banks, and they had failed, but not because of the little guys. They had failed, because they all piled up on the same side of a losing bet, with huge leverage. So the little guys got accused, while we read everywhere that hedge funds did not fail. That is disinformation. Smaller hedge funds made a fortune against the publicly financed, privately managed, HEDGE BANKS, which were too big to unwind their giant "investments" (and still are).

Imagine offering to pay for somebody’s house, because they had lost their house playing with your money, with their friends. And then you, the public, have to pay for the next house too, and the house after that, and the entire neighborhood of fat cats, as they all played with each other, with your money, and "lost" it all, giving your money to each other, buying for themselves other stuff with it, that it is none of your business to look at. All of this to ensure they still own the neighborhood, although you paid for it. This astoundingly gross conspiracy is what happened, it is called the "financial crisis of 2008", but the propaganda is so thick, nobody seems to understand the simplicity of it all.

The way out was just to nationalize everything, wipe the crooks out, and order the nationalized banks to finance the economy as needed for the furtherance of economic growth. It is said that government spending is responsible for 40% of Japanese growth in the last 20 years (but then, the government debt is 200% of GDP, much higher than Greece).

Those who had bankrupted the banks, were left just as powerful as before, if not more, because they realized they could get away with anything. They are so powerful that they are now able to block any reform which would hinder them. The bankers can even block understanding the very system which made them rich, this system that turn into a profit for the few, bankrupting not just the banks, but the entire "developed" world. Their half sentient robotized professors go on TV, orchestrated by the likes of Glen Beck, and sing as ordered.

Just today Glenn Beck, this uneducated, but well financed right wing preacher who weaves his discourse with material which sometimes seems straight out of this site, was comparing the fate of bankers under Obama to that of the Americans of Japanese descent under Roosevelt. The citizens had their freedom and property taken away, while the banks had the freedom and property of the citizens taken away from them, but for plutocratic propaganda it is all the same. Old fashion propaganda made people believe lies, but we have now a new type of propaganda, deliberately as confusing as possible. When the public does not know what to think, it does not know what to do, and, meanwhile plutocracy splurges.

***

HOW PPP LIES ABOUT WELLFARE STATES BEING POORER THAN THE USA:

Groupthink was made worse as economics, the theory of house (eco)-management (nomy), presently in power, is obviously wrong. Not just because it crashed, and stays crashed. But also because it can be easily demonstrated to be deeply flawed, in its most basic logic, here, there, and everywhere. Economists learned to enjoy a non sense financial system, a tail that wags the dog, making rich the opinion makers who approve of it. It paid to become non sensical.

I focus here on a technical instrument, PPP, Price Purchase Parity, used, often implicitly, by most American economists (see the extract from Krugman below). That neat little PPP trick ruins all fair comparisons of the USA with Europe. That is why PPP exists, in its present nature, for the greater glory of the USA as it is, and thus of American plutocracy. PPP undermines the will to leave behind the economic lunacy implemented in the USA in the last 30 years. Even the most critical of American economists are affected by plutocratic PPP cult.

Here is a subtle example of plutocratic propaganda hidden, no doubt unwittingly, inside Paul Krugman’s logos, just as he is making… a particular case of the general philosophical point I am making in this essay!

"There’s also an issue of labor-leisure choices. In the 70s the long-run trend of taking productivity gains out partly in the form of shorter working hours came to an end in the US, while continuing elsewhere. What that’s about is the subject of dispute, but it’s important to understand that a large part of the GDP difference between the US and Europe reflects that choice. France, in particular, is a country with about the same level of technology and productivity as America, but with roughly 25 percent lower GDP per capita; this mainly reflects longer vacations and earlier retirement, which may or may not be bad things, but are not a straightforward case of inferior performance."

I agree with Krugman’s basic drive here. The French could work more, but they prefer vacations. That is a different philosophy of economics. (Although the French government think the French ought to work more.)

At first sight, it is hard for US citizens to detect the misinformation above, because they have been fed it so many times before, it has become them. Moreover there is nothing subtle about it, and, as Hitler said, common people cannot detect big lies, because they only practice small ones. Repeating big lies all day long makes them into the truths, as far as the commons are concerned. That is the real tragedy of the commons.

Verily, here are the latest numbers from the World Bank in "nominal" GDP per person:

12. United States $46,716

13. Belgium $46,486

14. France $45,981

("Nominal" means: the raw numbers, as they are, converted as the currencies stand. "Latest": 2008.)

Contrarily to what the honorable Paul Krugman breezily asserts, one does not observe a 25% difference in GDP between France and the USA. It’s more like $750 per head, namely 1.5%. Tellingly, this deviation from reality is systematically entertained by American economists: they always insist that France is much poorer than she really is.

I must recognize it is embarrassing: the French are having their cake, and eat it, during their unending vacations. (Moreover, it’s even worse than that: France producing only a small fraction of CO2 per person or per unit of GDP of the USA, per person, or per unit of GDP, the difference of "wealth" of a grand $ 750, is more than compensated by the energetic inefficiency of the economy of the USA. In other words, the USA spends more on waste: sitting in traffic jams augments US GDP, more than it does the French.)

The left wing American economists say: "France is much poorer, but…" the neo-conservative, if not neo-fascist, American economists say: "France is much poorer, and… ". In both cases, American economists keep on crowing about the unequalled greatness of the USA, never mind that the numbers say otherwise.

However naïve and inappropriate, GDP is a straight calculation: it is the addition of all money transactions (kisses don’t count, only cash). However, Krugman and all American economists in good standing in the power halls of the USA, do not use GDP to compare France and the USA, that would be too sad. Instead they use a completely flawed theory of PPP. PPP is GDP manipulated by those who want to please plutocrats, as the later provide economists with halls of power to amble through.

***

PPP IS IMPORTANT, AND ITS BIAS MATTERS:

As it is, Krugman reinforces, however unwittingly, as I already emphasized, neo-con Americans with just what they want to hear. Namely that the French live 25% less well than the Americans. This looks like splitting hair, but the case of France is important, because France does everything the USA does, PLUS has a lesser gap between the rich and the poor, and is more of a welfare state. That is why American plutocrats obsess about France all day, and all night long, and make sure that the American public gobbles a distorted vision of that original source of American civilization (As Michael Moore pointed out in his movie, "Sicko", the danger is that Americans like the French all too much).

Americans plutocrats have been arguing that "welfare states" cost too much, and France, as she really is, proves that they are lying. PPP is the device that make academics able to support that lie with a clear conscience.

Why is PPP important? To validate an economic strategy, one needs to look at different economic systems, worldwide, and compare them. (PPP calculations are used to measure poverty rates, so they are very important socially, worldwide.)

Comparisons between economic systems are difficult to do because the worth of countries is, at first sight, dependent from their currencies, and the relative worth of currencies vary in time, often spectacularly. (Example: the value of the euro has varied, relative to the US dollar, by a factor of two, in less than a decade, from about 80 cents to 153 cents!) So economists invented PPP, to correct for that. It was a good basic idea. What is not working is that the computation made rested on an 80% wrong philosophy. In other words, it had a huge conceptual flaw, as I will explain.

***

CONSUMERIST OBSESSION VERSUS A MORE WHOLESOME PHILOSOPHY:

Existing PPP is erroneous for a drastic reason: STANDARD PPP ASSUMES THAT WEALTH IS ONLY MEASURED BY A FEW PARTICULAR CHEAP CONSUMABLES, AND THE CHEAPER, THE BETTER. As it turns out, the French care less about these particular goods, the French prefer other goods and SERVICES.

American economists find themselves in the curious position of cows declaring lions to be poorer, because in the lions’ den, grass is expensive. And cows believe that stuffing oneself with grass is of the essence. (Don’t laugh: the French have the highestanimal protein consumption per person, in the world, they do not eat water logged meat as all too many Americans do.)

Let’s go back to the problem at hand. The GDP per capita statistics used by the honorable Krugman (USA 25% above France) reflects INTERPRETATIONS American economists traditionally have to make, because they like to earn a good living.

It would not look good if the USA was not superior, where it is supposed to be superior, in providing wealth. The wealthy masters would be displeased, should that impression endure, and thus the rabble could become suspicious of the incomparable greatness of the USA, and thus for their great leaders. In North Korea, one cannot doubt the Great Leader, in the USA, one cannot doubt the Great Leaders, the so called "philanthropists", who lead America. So American robot economists, as good little scribes who want to keep their jobs, improve the statistics by nearly 25% in favor of the USA.

***

PPP: PHILOSOPHICALLY WRONG:

In particular PPP does not reflect behavior modifying taxes. The European Union has a mandatory minimal 15% Value Added Tax. That VAT makes everything at least 15% dearer in the EU. In France, Germany, the UK, the VAT is 17%, and 23% in Greece (as an emergency measure). The American economists react by saying that Europeans are that much poorer (by 17% in Franco-Brito-Germania).

This VAT abates the consuming of goods, indeed. It also buys Europeans a lot of state mandated services… The wealth does not disappear, it is replaced by a balanced diet, with more services in it. Those services the Americans are deprived of, but the Europeans cannot do without. So who is the wealthier? Those, the Europeans, who have services that the others, the Americans, have not, or are those Americans wealthier, because they can buy even more stuff made in China?

Thus I have a general objection to PPP. Conventional PPP assumes that wealth is judged by goods Americans splurge on. This is weird: most of the wealth produced by advanced countries is in SERVICES. Services constitute more than 80% of the economy of the France, or the USA. PPP only concentrates on 20% of the economy.

The French like to be served, with health care, education, and general caring. The difference between France and the USA, is that Americans are content to go to the restaurant, and be served there, so restaurants, and valet parking, are very important in the USA. Whereas the French like to be served all day long, not just when they go to restaurants. The French like to be served in health, education and welfare more than Americans do, so more French economic activity is diverted into services rather than in purchasing some particular consumables Americans are more obsessed by. The French do not just define wellness with splurging on Chinese made goods (although they do that too, just not as much).

PPP assumes that if a hamburger cost only one cent in the USA, and 100 cents in France, the Americans will buy 100 hamburgers when the French can buy just one. Thus, say American economists, the Americans are 100 times richer than the French. Instead, a good doctor will say that the American economists are risking obesity, and cardiac arrest. And obesity of the brain, too, they think too much.

Moreover this is a virtuous, or, at least, a fattening, loop. While Americans gulp more and more hamburgers, the price of hamburgers drops, because the more demand, the more supply, the more of the Amazon forest is cut down for vast pastures to raise cattle to feed American economists and financiers, etc…

***

PPP: PLAIN PLUTOCRATIC PHILOSOPHY:

A country such as France deliberately taxes consumption. The idea is to limit waste, and increase savings, thus investments (France has indeed a better, more modern and performing physical plant than the USA; only the army of the USA is better equipped). The difference between the gourmet and the pig comes to fore.

The encouragement to save and invest reminds one of what is asked from private banks today: augmenting capital requirements, lending to the real economy. France wants its population to be rich, not just indebted. It is a lesson of history. A debtor, in the European Middle Ages, one called that a serf. Men who wanted to be freed of their obligations defaulted by fleeing to the cities. Later some fled to the Americas. A land of owners, such as France, is more economically motivated than a land of debtors, such as the USA. So they get more involved, and demonstrate more. So good was this approach that it was adopted by the entire European Union (even the UK, as I said!)

Hamburgers or savings? That is the question. PPP, as presently computed, is biased towards viewing consumption of goods as an absolute good. Health care basically is free in France, thus, say American economist, worthless. Same for education. Free in France, so worthless.

Those who have long lived both in France and the USA, will guarantee you that the average person lives poorer in the USA. And even the rich in the USA have to worry about private school for children, extraordinary medical expenses etc (there are private schools in France, 25% of the total, but they are getting state subsidies, and are about ten times cheaper than in the USA, where they typically cost at least a third of the average family income!).

It is revealing that American economists such as Krugman, who howler about the end of the euro, because it is coming down from its 54% overvalued peak, use an undervalued euro to evaluate French overall economic performance. It is variable geometry economics: true here, false there, depending upon what one wants to prove, depending upon what will please the masters, those whose name is on the buildings on the hallowed campuses of power of the USA.

In any case, Price Purchase parity is an example, one of many, of a basic economic notion assuming the inferiority of some philosophical values. Unfortunately for the long term reputation of American style economic theory, our civilization, and even our non pathological neurology cannot do without these philosophical values.

P/S 2: PPP, this Pathological Plutocratic Ploy, has long been well known to be biased. The conventional objection to PPP is that it does not reflect standards of living, because:

• PPP numbers can vary with the specific basket of goods used, making it a rough estimate. (Example: "The Economist" loves to use the price of hamburgers, worldwide, and claims that its "Big Mac index" is just as good as PPP, thus unwittingly proving how bad PPP is, since in many countries people don’t care about hamburgers. In those countries there is less demand for hamburgers, hence less supply of hamburgers, hence smaller economies of scale, hence higher prices.)

• Differences in quality of goods are hard to measure and thereby to reflect in PPP. (Example: In the USA , meat is often loaded with water to be made cheaper, a cheap trick unimaginable in France. So USA meat is less good quality than French meat, its lower price reflecting in part the lower price of water. other ways to improve the PPP of American meat are antibiotics and hormones and lower quality feeds, the first two are, unlawful in Europe)

I added above my more drastic objections.

P/S 3: The cheating on PPP affects primarily international comparisons. The cheating on other major economic such as the CPI affects more directly daily lives of average citizens. Using the pre-1980 inflation calculation method, the Consumer Price Index would be over 9 percent. Today’s reported, official CPI, is around 2 percent.

The government gets there by using a a basket of goods that does not match the real-world cost of living. For example, health care costs are one sixth of GDP. but only one-sixteenth of the price index.

Subdued reported inflation enables the Fed to rationalize its easy money policy (which profits big banksters and their derivatives), and it allows the government to reduce payments to the common People (such as social security). It also allows to overestimate reported real GDP, higher reported real income and higher reported productivity.

Abstract: Germany, a republic, has seized the destiny of its currency in its hands, by outlawing some "derivatives" and "naked shorts on financial stocks" (when, unbelievably, financial pirates sell what they don’t own yet).

Meanwhile, finally, the Obama administration is pushing through a financial bill that has some teeth against so called "Shadow Banking", the vampire that hid in the night to suck the world dry.

The tyranny of "Shadow banking" and its associated derivatives has drained the developed world out of capital. Most capital was confiscated by an immense conspiracy hidden in plain sight behind notions so complicated that people fall asleep before understanding them, any time they try.

That is precisely why finance was made so complicated. Thus the prestidigitator makes elaborated moves and lenifying speech. But these prestidigitators of evil are part of the same establishment that makes war all over the world, as they invite us to bathe in oil. So let me present some simple aspects, again, of the greatest larceny that ever was. (As the Senate will now debate with Congress on the financial regulation bill, this is timely.)

***

***

The financial pirates and their media and academic helpers have been using the grossest propaganda to come to the rescue of financial piracy as an industry.

In particular, the popular right wing talk shows in the USA are making a relentless drive against the "progressive". Those are people so extreme that they view Franklin Roosevelt as a "dictator" (Glenn Beck said as he evoked with horror the financial reforms of Roosevelt, which brought unprecedented calm and prosperity until they were dismantled by Lawrence Summers). The rabid, but very popular right wing talk show hosts are amply helped by university professors, just as the Nazis were.

When the Nazis showed up, a mistake was made by people who thought progressively: they did not take the Nazis seriously. The technical point is this. Those right wing extremists think, like crocodiles think. Thinking does not make the croc right, but it makes it much more dangerous. The croc does not think very well, still, it is the duty of the intellectual to outwit it. Otherwise the intellectual will be killed, just like the innocent children were, by the Nazis.

As it is right now the direct "defense" budget of the USA is 708 billion dollars (without counting the budget of the secret "intelligence" agencies, including the CIA, which may well be above 30 billion). This is about half of the federal budget of the USA under G. W. Bush.

The same people who love financial piracy also love "defense" budgets getting ever more enormous. It is the same general idea of predation onto others, predation onto the world. To have a vague idea of the consequences, please visit the nice beaches in the Gulf of Mexico, and enjoy the oil. Otherwise, think of the dead in Iraq and Afghanistan (two wars arguably started decades ago by agents of the Western powers, agents of the shadowy type; this, by the way, goes well with "Shadow Banking", and this is no coincidence.)

A recall from history, 2070 years ago: so preoccupied were the plutocrats with smothering the Roman republic, that they let pirates gain control of the Mediterranean. Even on the sea closest to Rome, it was not safe. The young Caesar himself was captured, and held captive in Corsica, until a colossal ransom was paid by his family (as the pirates let him go, he promised to have them all crucified). At the time, pirates controlled entire regions, and possessed large fortified cities and their ports. Earlier Rome had controlled the entire Mediterranean sea. But no more. Pirates ruled.

Finally the republic had enough, and gave full powers to the very young and famous general, Pompeii. To everybody’s amazement, Pompeii destroyed all the pirates, throughout the Mediterranean, in three months. Three months. It had proven easy to destroy the pirates. What had been missing was trying to do so. We are facing a similar situation, with the financial pirates. They can be easily destroyed. All we have to fear is greed itself, among those who lead.

Recently the New York Times ran an editorial about "What Is Philosophy". The author, a paid philosopher, meekly proposed that philosophy consisted in "taking one’s time" (from something Socrates mumbled). Another philosophy professor commented more soberly that anybody who, like himself and the NYT author, was paid for philosophizing, was not the real thing.

I fully agree with the second professor, and would go further. We may also have the same opinion about economists. Economists hide behind jargon and mathematics, but the field is fundamentally philosophical: economy is about managing the house, not about assembling dissembling jargon, as salaried economists seem to enjoy doing.

Notice that, far from being professors, most significant philosophers were rebels. Those who were not rebels, such as Kant, a professor to the Prussian state, in Koenigsberg (now Kaliningrad) taught what the state wanted them to teach: obedience. Eichmann, the notorious mass assassin of Jews, said that he applied Kant’s teaching strictly, and quoted him cogently during his trial in Jerusalem. Hegel and Heidegger are other examples of "philosophy" professors serving the state (the Nazi state in the second case, and many lost souls still believe Heidegger to be a genius).

The Obama administration, and others (Krugman, Johnson, Stiglitz, etc.) have said that they want to prevent a repeat of the crisis of 2008. But that is too meek a point: the whole developed world economy is crashing, and it has been crashing for a full decade; 2008 was just a bump during a much larger crash.

China and India are not crashing though, precisely because they have (giant) government banks, doing what banks have always been supposed to do: sheltering savings from savers, lending them to worthy projects in the real world. This activity develops the economy. The two largest banks in the world, by far, are Chinese, and no doubt the severest punishments are ready for their managers, should they misstep.

It is revealing that the "developed" world is called developed, as if it did not need to be developed any further, an implicit admission by plutocrats that, from now on, only their own fortunes shall develop significantly (so called "GDP" growth).

In the fractional reserve system (be it in China or the West, such is the system), banks are always government, privately managed. This is so true that the central bank of the USA, a creature of the banks, is also viewed as a government entity.

Why is the developed world economy crashing with its research, basic services, employment and, um, further development? Why are China and India developing by leaps and bounds? It is two sides of the same question. "Developed world" banks have been allowed to confiscate most of the capital, and trade it among themselves in an unreal market, the derivatives.

There are many types of derivatives. As their name indicates, they are all derivative to functions in the real world. To describe most of them as insurance or equity is inappropriate. Honest to goodness derivatives have existed for 5 centuries, in Japan, China, and Europe. They existed for about a century, in connection with the future prices of farm products, in the USA, in Chicago. In all these cases, they were appropriately provisioned contracts. They could, indeed, behave as insurance (a farmer could insure his real world production with futures going the other way, and since he was the expert, it would profit him, a bit as a casino can rig the bets to profit from them, just so).

Not so anymore today. The derivatives the world economy is crumbling below today have become a metastatic cancer devouring all capital, and more, pumping all the world potential energy, and more.

Thanks to Rubin and Summers, those plutocrats serving themselves and their kind, under the naive puppet in chief Clinton, derivatives were derived from anything whatever, in all and any ways. For example derivatives squared, derivatives of derivatives. A market of these derivatives was made, consisting in bets among banks and hedge funds about how things will go. This "market" became as large as twenty times the entire world economy. Hidden from view was the fact that this was all public financed (be it only from the zero interest rate policy).

The defense of derivatives by finance professors would be hysterically hilarious, if the leadership by financiers had not been so tragic already (from the wars they caused to the poverty they fabricate) . To say that "If derivatives are bad, then so too is the equity in any type of company, small or large, private or public, including those that produce real products and commodities…" is revealing: the author, a finance professor, thus admits implicitly that derivatives produce nothing real.

Question: can we afford to have most the world free capital producing nothing real? And, since the banks have the fiduciary duty, through the factional reserve banking system to leverage public money into the money most people use, how can we tolerate that most of our money is used for nothing real?

When 300 billion of house mortgages defaulted, up to 24,000 billion dollars of derivatives were potentially lost, in the USA alone (Europe has its own derivatives too).

Insurance without any funds to pay for it is pure theft. This was the case of Credit Default Swaps. The taxpayers were left with the bill. The plot between Goldman Sachs and AIG was nothing more than planned robbery, and the government, represented by Paulson, past chair of Goldman Sachs, seconded by Geithner (who was paid by the banks), played its role.

Derivatives such as naked shorts are little more than taking fire insurance on the neighbor’s house with the ability to set it on fire in all impunity.

Derivatives ought to be allowed only when safe, and effective, for the people and entities engaging in these contracts, and for the system at large, which is the entire world economy. The world cannot function when the derivative is twenty times bigger than the real thing. Those who do not understand that ought to take the most basic calculus class imaginable.

I understand, though, that the incredible leverage provided by derivatives has created an entire corruptocracy, from financiers to their valets teaching the wrong notions to the young and naive. They don’t need to know calculus: being dominated by greed is enough to them. Greed is not just good, it’s the only thing. Even calculus cannot stand in the way of greed, they think, and they bleat.

Loosely, but correctly, calculus says that the derivatives are always much smaller than what they derive from. But today’s corrupt financiers adulate derivatives that are twenty times bigger than what they derive from (calculation: yearly "GDP" of derivatives divided by worth of GDP of "developed" world).

It is always revealing to listen to the fanatics of derivatives, and shadow banking. When you inform them that banks should be forbidden to speculate (a principle espoused by Sarkozy, president of France, and Volcker, past Fed chair, and adviser to Obama), they do as if you were naïve. They always say:"Oh, if you outlaw this, and outlaw that, the banks, and hedge funds, will do it in the shadows, where the government will not be able to see anything, or do anything."

That is funny, because those contradictors, those plutophiles, assume that financiers can easily violate the law, that is apparently what they do best: they just have to go back to the shadows, and do their thing, and can get away with it. Question: what happened to the state of law?

Well, the time has come for the republic to grab a few of the biggest financial geniuses, and make believe "philanthropists", and send them to jail for a long time, for financial piracy. Examples are always instructive.

So what is evil? Well, the will to hurt others, just what derivatives have been doing. Evil is a derivative of survival, but that does not mean we should worship it, as if we were crocodiles, eating each other. How do we get out of it? Well, by being genuine, not derivative.

Patrice Ayme

***

P/S: One finds above a hard mathematical idea: thederivative OUGHT to be less than the function it derives from. This principle OUGHT to be imposed both globally and locally (on the set of all derivatives, and on each derivative too). Not having it is tantamount to pathological mathematics (of the sort called counter examples in analysis: a highly fractal function can be smaller than its derivative, but such functions do not exist in the real world, except at the Quantum scale; imposing them boils down to imposing a macroscopic quantal world, where prediction is impossible, and catastrophe, the norm).

Economically that will force created money back into the real economy, where it could be used to prevent oil spills and make fusion-fission reactors, besides teaching the young.

In any case, my principle, that the derivative OUGHT to be less than the function it derives from, ought to guide regulators. Call it the Non Pathological Requirement.

Summary: The psychological effects of inflation are misunderstood, and misemployed, causing underemployment. Gentle inflation is best, ultra low inflation is bad and dangerous. There are philosophical, and technical, reasons for that.

Gentle, but significant, inflation stirs the economy as needed, and advantages advancing technology relative to the forces of sedimentation of the obsolescing past.

The inflation target of the European Central Bank, 1%, is way too low. The US Fed is just as bad, with its zero interest rate policy, which mostly serves its friends in the plutocracy. As it is, the zero interest rate policy does not provide money to the real economy, and other things need to be done.

One of the things to do: target inflation around 4%.

***

EURO SINKING, EUROPE RISING:

The European constitution enshrined the erroneous notion that the European Central Bank could enforce the value of the euro without worrying about the European economy in general, as if one could have a currency without an economy (the mandate of the Fed of the USA is to watch over the currency, and the economy).

This conceptual imbalance, a currency with an economic disconnect, led to an overvalued euro, while putting the Chinese economy on steroids, and allowing American plutocrats to splurge through the elaborated web of corruption they sneakily set up for themselves worldwide, leveraging themselves on the strong euro.

The Sino-American circus at the Copenhagen climate conference pretty much torpedoed decades of European evolution towards greater efficiency. It was pretty obvious that Europe’s entire strategy to switch, at immense cost, to sustainable energy and low CO2 production, was a casualty of plutocratically driven Sino-American expediency.

Europe was condemned to keep on sacrificing itself while China rips its intellectual property (example: duplicating Siemens Very High Speed trains!), demolishing moreover its industry by unfair competition, due to the undervalued Chinese currency, and the USA could keep on enjoying quasi free energy, while polluting the entire planet with its addiction to deadly fossil fuels, while rampaging militarily throughout Central Asia, looking for more, as it enjoyed the protection of the overvalued euro.

Something needed to be done. The Sino-American arrogance was enabled by the overvaluation of the euro. European products could not compete. The European economy was stagnating, and its substantial essence was invigorating Chinese and Americans, whose economy progressed by leaps and bounds.

The euro had to go down, European advisers concluded. Miraculously, suddenly, Europe observed the presence of Greece in its midst. It was always known that Greece was a desperate case, as it converted its drachma into euro at too high a rate (making the Greeks instantaneously rich and unemployed). But it had not been observed yet, as it deserved. It’s good to have a desperate case in one’s closet, to frighten the vampires with.

So now the euro is going down. Patriotic Europeans ought not to be satisfied until it reaches parity. Come to think of it, a few years as undervalued as the euro was overvalued, should do wonders for the European economy. (Let see what happens to the plutocratic USA, as it faces competition from correctly priced European products!)

This being said, the ECB inflation target of 1% is deeply erroneous. Inflation actually spurs demand: it is no coincidence that so many German products were sold to the parts of Europe with the most inflation (the PIIGS). Without that inflation, Germany would be doing much less well.

Just an example: Spain has bought Very High Speed trains from Siemens (which reach 250 mph, 400 km/h on the Madrid Barcelona line). Spain could have bought equivalent VHS trains from Alstom, the French company which is the competitor of Siemens. So now Spain has a deficit, and some Germans whine. Would they prefer Spain to have bought French trains? (By the way, the Chinese deconstructed and mass produced Siemens VHS trains, in an apparent violation of intellectual property… and now they propose to sell said stolen property to the USA).

***

THE EURO: A MINIMUM WHICH NECESSITATES MORE.

After 1,000 years of intra European wars between people who wanted too much, the meta principle of construction of Europe is to proceed minimally, as needed. No more, no less. The euro was established because one cannot have dozens of countries each with its own currency, in a small place: that was the necessity.

Another more drastic reason is that the French and the Germans (and the Benelux, Austrians and Northern Italians) do not see why they should not have a common currency, although they see plenty of reasons to have one. As far as the French and Germans are concerned, to have different currencies is as smart as having West Texas with a different currency from East Texas. But then France, Germany and the Benelux, that’s 180 million people.

So now 16 countries are in the Eurozone. More are in it informally (such as Romania). Estonia should formally join in 2011.

The euro was established as a currency, without governance, except an honorable promise, that everybody would be saintly, and keep yearly budget deficits below 3% of GDP (and 60% GDP for total state debt). That promise was broken, as soon as France and Germany found it was in their best interest to break it. At that point a crisis was certain: the magic spell had been broken. If France was going to allow a 8% deficit, Germany 6%, why should not Greece have 9.4%? After all the paragons of financial supremacy, the USA, has 11% deficit, and Britain, 12.8%…

So the crisis exploded, after the Copenhagen disaster. Greece was called a disaster, and the money manipulators scurried for their little lives, unknowingly doing the work of French intellectuals. The euro finally went down. A bit too fast, though: scary interest rates of the order of 21% on some Greek government debt were seen. It was time to slow things down.

The French have long promoted ECONOMIC GOVERNANCE. The way many see it in France, French taxes act as a subsidy for many other European powers. And not just because of the completely independent French nuclear umbrella; Britain has long behaved as a less regulated extension of Wall Street, with plenty of fiscal paradises attached to itself (Anglo-Normand islands, Isle of Man; arguably all of Britain was a tax heavens for non UK plutocrats), something that exploded in 2008: the AIG unit that cost US taxpayers around 180 billion dollars was based in London, to fully enjoy deregulation, New Labor style.

The trick to lower the euro degenerated in a sovereign debt crisis, and Europe finally reacted to it. Merkel went to Moscow to celebrate victory on the Nazis with the Russian leaders, as NATO forces paraded on Red Square in front of the Kremlin, as they should. Sarkozy cancelled, stayed home in Brussels to handle the debt and fiscal crisis, leaving French troops to parade without their president.

That was the Franco-German duo at its best: France, seconded by a trusting Germany, in command, making the Lisbon Treaty instantaneously obsolete, as required by the crisis at hand. The European Central bank was suddenly given powers it never had, and that the Lisbon constitution excluded (but which all real central banks have), such as buying bonds from member states (the US Fed has long been selling and buying its own bonds, in a gymnastics incomprehensible for those not abreast of these mysteries… but it is crucial; the Fed also bought for no less than 2,400 billion dollars of mortgages.)

France and Germany together are a superpower. Others have to join. This is how the EU works, how the Schengen Treaty and the Eurozone work.

***

CONTROLLED FLIGHT INTO TERRAIN (CFIT):

Inflation is collapsing:

BLS, Cleveland Fed.

This is bad: should this go on a bit more, there is no way out.

*

American economists ought to worry about deflation, instead of penning anti-European rants with no deep philosophical underpinnings. The European Union had deep philosophical roots, 2,000 years before there was Hitler, and he got crushed, he and his fascist racist ideological company. As soon as Germany and France became again politically identical, there was no reason left for the Verdun Treaty’s partition (August 843 CE). So now we have a united Europe, and American economists should worry about depression in the USA, not worry about fostering disunion on a continent far away, in the apparent hope that the USA will triumph once again.

Uncontrolled deflation is flight into terrain, and low inflation targets invite it. It is clear to me that the 1% (!!!!) inflation target of the ECB is a philosophical, and technical mistake. Recently the ECB was congratulating Estonia for having achieved that target: bad.

First technically: inflation can be controlled, by rising interest rates. Once Carter had nominated Volcker to crush inflation, Volcker was able to do so by rising interest rates to 23% (causing 2 recessions and making Carter lose the election).

Deflation cannot be controlled, though. A simple analogy: in a plane, if one is high enough, one can go higher. But if one has gone down too much, one crashes into the ground. A plane can fly higher, but a plane cannot fly underground. Economists need to be brought back to earth safely.

To pursue the aeronautical analogy, an economic bubble is like a stall for a plane: one goes up too high, too fast, forward motion in the medium becomes insufficient, lift disappears and one falls.

Forward motion, in economics, is real progress made into the physical world (some of it Sisyphus style, as in repairing potholes, curing the sick; some of it grandiose, as when switching to new, more advanced technologies, some of it necessary as in teaching the young, and the deciders). The economy, as the plane, needs to provide lift, lest it crashes (the world economy is the largest machine, and, as all machines, it can fail). When the Soviet economy failed, lifespan, health, income and creature comforts collapsed. Economy is not just about profits, contrarily to what plutocrats think (supposing they think)

There is another more subtle effect illustrated by the aeronautical analogy. Applying the full power of zero interest rates when already crashing from a bubble gone wrong, can make the situation worse.

There was a strange crash of an Airbus A 330-200 in Tripoli, with a fatigued, sleep deprived crew, facing the rising sun, with a foggy mist on the ground. The pilots apparently mistook all too long the desert for the runway. After removing the last safeguards of the plane’s computerized brain, they came next to the ground, realized their error, and applied, too late, the full power of the Airbus, which is enormous. The plane reared steeply, more than 20 degrees, said the captain of an Alitalia jet behind, and roared up. But its tail hit the ground hard, tearing from the rest of the airframe. Still dragged fiercely by the engines at maximum power, the jet pitched down, and drove into the ground, pushed by its engines, disintegrating into remarkably tiny pieces.

Controlled Flight Into Terrain. What happens when you apply maximum thrust while crashing into the ground (A 330-200, Tripoli, May 2010).

***

Morality: if one has already started to crash into the ground, applying more power will only cause further damage.

Translating this analogy to economics: in a free market, fractional reserve banking system, the maximum thrust is given by the zero interest rates policy. The more one lowers interest rates, the more banks can lend (since they get money at zero interest, free money, from the state). Fine, that’s the theory. But to who do they lend, and for what? Absent government control, they will do what they have done best lately.

Unfortunately in the present morally corrupt system, the banks look for the strongest profit, for themselves, and that is not obtained by investing to optimize the real economy. Instead publicly financed private banks invented a casino in the sky where they attribute each other imaginary profits.

Thus, the stronger the banks, the more they do what they do best: giving to their friends, to their politicians, past, present and future, indulging their addiction to derivatives, shadow banking, and various other conspiracies between each other, to create fake profits, while the central banks shower them secretly with free money.

In other words, the lower the interest rates at which the central bank gives money to the banks, the more the banks do exactly what caused the crash. Or rather, the crashes: the financial crash of 2008, and the slower and more formidable crash of the entire social and economic system of the West (which has been going on for more than a decade).

This is true in Europe, where the enormous "private" financial institutions fed the economic imbalances of the PIIGS (Greek GDP per head is way higher than Greek earnings, through borrowing and subsidies). Thus the real economic and fiscal problems of Europe have nothing to do with not providing low interest rates (they are nearly as low as they can get), rather the opposite. The same holds in the USA.

Instead, the economic and social problems arise from the moral values of the main economic actors, what they do, and the activities which have been encouraged, creating imbalances, but mostly a lack of forward lift (hence the Tea Party, the return to no government, the early Neolithic).

Forward lift in economy is provided by better (more powerful, efficient, ecological) technology (necessary, as the old resources and methods get exhausted). So, to sustain the economy and the way of life, one needs to provide continually better, more complex, technology (this flies into the conception of Tainter that higher complexity kills; instead, it saves lives, and provides economic lift).

How does one provide more advanced, more complex technology? Well an ever more advanced thinking system is one necessary factor, dire need and regulation are others. One can even get a little help from the free, for profit market free enterprise as in Silicon valley, where greedsters mix with inventors to produce gadgets.

But INFLATION ITSELF CAN HELP TECHNOLOGY BY MAKING THE GENERAL POPULATION THIRSTY FOR INNOVATION.

***

INFLATION INFLATES THE DESIRE FOR BETTER TECHNOLOGY:

Inflation advantages the implementation of more advanced technology, because inflation forces people to continual reevaluate their old habits.

Conventional economic theory has it that people look for the cheapest product, or for better products, or a mix of these characteristics. Right. But, before looking, people have to WANT TO LOOK. Or have to be FORCED TO LOOK.

Conventional economic theory has forgotten that detail: if consumers don’t need to bother, they may well not bother. Inflation is a spur that forces economic participants to look, and makes actually the entire public into savvy , even philosophical, economic participants, lest they drown in rising prices.

Indeed, old habits depend upon old values, and old consumption patterns. When inflation permeates the economy, all prices rise, and create a dynamic ecology, by changing continually the environment, forcing speciation of new technology, that serve new habits. It is exactly what happens when speciation in biology is forced by environmental changes.

Increasing prices force people to continually look afresh at whether their old habits are WORTH IT. People see the costs and prices of what they used to like go up, and they ask themselves: why not to try something else?

Often they find the old less worthy than the new. How? New products depending on higher technology benefit from automation and simplification of production. The latest TVs have very few parts, several orders of magnitude less than the old ones, and this is true over all of engineering. Hence the prices of the most modern products rise less. Some will say that the price of these products and services would go down in a zero inflation world, and it makes no difference. Sure, they would go down, but there is a difference.

Te point is that consumers do not have to look at the costs of the new products and services, so they may, and will, ignore them, MUCH MORE than in a world where the products they are used to rise in price.

Also, as inflation works its magic, people will question MORE paying through the nose for traditional, hence less efficiently provided products and services. Basically a good measure of inflation forces the hand (manual labor) to compete with the mind (intellectual labor), and the hand is found wanting.

1% inflation target is a clear problem: it risks to forever extend the Great Depression we are in. For all the preceding reasons, 4% ought to be the inflation target. This is not enough, but it will help.

***

PA

P/S: A well known interest of gentle inflation is that it makes sovereign (government) debt manageable, through nice and easy default, compensated by increased economic activity. This is all the more necessary since the present austerity packages will only make the deflation worse, and are untenable, if not compensated by significant inflation (which will have to be engineered by government programs, as during the New Deal, or with the help of national banks as in India or China; clearly these examples show what needs to be done, in the West, again).

Inflation can be compensated with subsidies for the poor, as France did in the pre-Trichet era (Trichet was head of the Banque de France for 10 years or so before becoming ECB head, and is an anti-inflation hawk of the excessive type).

Abstract: A first paragraph on the clear and present plutocracy in the USA is followed by a paragraph explaining that Rome degenerated because plutocracy requires the people to be stupid, but stupid people can’t handle a world that is not exactly the same as it was before.

As Rome, a self proclaimed "developed world", stagnated, stupefied under the decerebrating plutocracy, the Barbarians caught up, technologically, and the ecology got exhausted, and the fascist leaders reacted with more fascism, and more mental terror, making the situation worse. That is how Rome "collapsed". The rest is details.

The next paragraph is a reader’s objection, which was made to me already several times. The reader reminds me of the thesis of Tainter, a professional historian who is often brandished these days by the plutocrats, to explain away the problems the West is having, and, in particular to claim that a notion such as plutocracy has nothing to do with them (this is total contradiction with the classical view that greed is THE explanation for decay, ever since Solon, the founder of the Athenian constitution, 26 centuries ago; Solon, a poet and philosopher, and a very courageous politician and revolutionary, took strong anti-plutocratic measures which allowed Athens to blossom into her golden age).

Tainter believes that societies become too complex, and that is too onerous, so they collapse. I try to show, with a few elements here and there, why this neo-conservative thesis is completely erroneous in the case of Rome (and also in other cases, including the present one).

Tainter’s thesis fits with the meta principle of the USA ever since Nixon: reduce government, turn everything to the private sector (Nixon created private Health Maintenance Organizations, on the public dime, hence massive for profit health care in the USA; later Reagan took Nixon’s torch, and set the government on fire, with his boy, Summers. Summers was allowed to continue his work of destruction under Clinton, and was of course chosen by the most brazen plutocrats as mentor for the naïve young Obama; the public financing of private banks has blossomed ever since).

Finally I fast forward in the last paragraphs to the situation now. It is getting quickly worse, philosophically speaking. Philosophical Rubicons are crossed, the abyss is near.

Although this is not the subject of this essay, civilization, to function, has to create its own strong morality, which is different, and opposed, to the natural morality of man, which is, in part, violent, evil, even "criminal" (by civilizational standards).

This tale of two moralities is complicated by the fact that, by definition, civilization brings together immense numbers of people, allowing the full power of the exponential function to come into play, for better or worse.

The exponential can grow the good in proportion to itself. It can also grow evil, proportionally to itself, and the power of greed, proportionally to itself. In other words, civilization’s exponential is Pluto’s best incubator (Rousseau vaguely guessed this).

Pluto is not just about money. The Greek philosophers condemned plutocracy, and City-states passed laws against it, and abuse of riches; even imperial Rome did this. My critique goes much further, though: it’s not just more and more money in fewer and fewer hands, it is also more and more evil in fewer and fewer hands, as the supine masses contemplate bovinely the gathering slaughter, sighing vaguely that it is not about them. (Yet.)

Thus the decay of civilization starts with the decay of morality, rotting from the top. Because civilization has let its guard down, as it stopped fighting actively the exponential growth of Pluto, that it itself generates.

And here we are: torture made official, predator robots hunting humans as in the Terminator movies, the president crowing about it, greedsters government supported, at the cost of nearly everything else, pirates crowing about using worldwide conspiracies to undermine countries and currencies, and now, last and not least, assassination of citizens, just because they do not think right, and talk too much.

Even in the Middle ages, European governments did not assassinate citizens for thought crime: a semblance of judicial process was maintained. It was felt then that the state of law required judicial executions, to maintain, at least, the appearance of justice. But now the government of the USA is trying to introduce a new custom: think bad, die fast. In Latin: new "mores", new morality. The abyss is here. (A telling detail: Republican Rome was neither torturing nor, a fortiori, arbitrarily executing citizens. It was against the law. A law the fascist Roman Principate violated, in the next five centuries.)

***

***

PLUTOCRACY BIG ENOUGH TO DROWN THE WEST:

A number of financial big shots have insisted that preventing individual banks to become Too Big To Fail would be enough of a reform. But this is completely insufficient, because what has become too big to fail is the entire financial industry. And the financial industry used that power in 2008, as I pointed out at the time. The top financiers said: give us money, to us personally, or we will close the ATMs, and cut off all the money economy. They were given the money personally, instead of yanking out the banks from them, and nationalizing them, with that same money (to be sold later at a profit, as Sweden did). As it is, even now the entire financial system is on life support from the public, as the plutocrats keep on splurging on the money flow that, unbelievably, they are still given the opportunity to control (control beats jail, any time).

In theory, finance is supposed to be like an oil, allowing the friction-less transmission of savings to valuable investments. Right now it has become instead a metastatic oil spill engulfing civilization. This is entirely due to the fact that politicians have been bought by that financial cancer they helped create stealthily. The system keeps on growing, because the public does not understand how the labor, saving and taxes of common people is used to make an oligarchy very rich. It is not so much that it is too technical, and people do not have enough mathematics, nor moral fiber left to appreciate how revolting that exploitation has become. No, more simply, a careful propaganda machine disguises the tricks used by the financial oligarchy.

Just thirty hedge funds control, together, more than one trillion dollars (that is 2/3 of the normal USA federal budget). Now, of course, the largest banks are behaving like hedge funds. This is actually by behaving as hedge funds that the bank holding companies collapsed in 2008: 300 billion dollars of mortgage defaults were transformed into 24,000 billion dollars of potential losses, in the USA alone, as the hedge funds like bets of bank holding companies backfired.

The financial crash was purely a hedge fund phenomenon. Had the Banking Act of 1933 still been in force, this could never have happened. (But the plutocratic boy, Summers, had demolished the Act under puppet-in-chief Bill Clinton.)

So here, when I say 30 hedge funds control as much as two third of the federal budget, by "hedge funds" I meant pure hedge funds, the ones reserved to the hyper wealthy (by the way, to open an account at the so called "bank" Goldman Sachs, you will need ten million dollars, although every US taxpayer gave vast amounts of money to Goldman Sachs, by paying taxes, they can’t enter that temple of wealth). Oh, by the way, there are not just 30 hedge funds: there are about 10,000 of them in the USA, and as many in Europe.

Hedge funds use strategies such as "butterfly" trading. They consist in taking huge leveraged and opposite positions. One side will always lose, but the other will win so big, that it does not matter. All what is needed is markets that move big (so that there is a big loss, or a big win). So the question about the monstrosity of finance becomes: can an "industry" that controls around 15 times WORLD GDP move markets?

There are other lightly regulated pools of capital, and tax heavens are part of the shadow financial empire which tries to control the planet. The tax system of the USA is entangled with US corporations and tax heavens, so this plutocratic system functions as an integrated whole: the USA’s political structure has been captured by plutocracy.

In 1998, one hedge fund, Long Term Capital Management failed, and the US Federal Reserve intervened on the most gigantic scale to save a number of investors who were friends. It’s all about friendship among the rich and famous. The Fed, the supposedly independent central bank of the USA, is part of that system, and fears to be exposed to the light of the day, as all good vampires do (that is why it does not want to be audited by the US Congress, lest all the gifts to friends would be exposed to the light of the day).

Quantitative and high frequency trading increases the complexity, opaqueness, and self fulfilling prophetization of financial markets, allowing plutocrats to become ever bigger relative to the political and economic systems. Market shut-downs such as the one of May 6 (market down 10% in a few minutes for no reason whatsoever, except huge sell orders from giant plutocratic organizations: Citi, etc.) will increasingly happen. US Senators were just engaging in a vote to curb the banking industry at the time. When asking for explanations, we were told that a trader confused the letter m, and the letter b. So he sold billions, in a fraction of a second, when he should have sold millions. It reminds me of fairy tales for children. Panicked, the senators did as they were told, implicitly, and voted down a pesky law, that would have bothered the banks.

***

ROME CRASHED BECAUSE PLUTOCRACY SUSPENDS EVEN INDISPENSABLE PROGRESS:

In Rome, the richest of the rich became so rich that they ended up owning the country. This is happening now, again, and foremost, in the USA.

The universes of derivatives, shadow banking, tax heavens are the ultimate too big to fail that sucks up nearly all capital, depriving the rest of civilization of sufficient economic activity (capital is potential power; no capital, no power).

The hundreds of trillions of derivatives, many times world GDP, are as much capital which is not available for the real economy. This is why important technologies either very different and practical, or futuristic and indispensable, are not developed. And why there is not enough money for education, and any other activity that could make the masses more clever, and see through the system (seeing through is good for technology, but very bad for plutocracy, which thrive on the unseen).

Plutocracy blocks technology.

Why? Because technological progress depends upon intellectual progress. Plutocracy wants the population to be stupid and impotent. Blocking intellectual progress, and thus controlling the learning and thinking institutions that allow progress is foremost. The Roman emperors deconstructed the educational system, burned the libraries (starting with emperor Jovian, 363 CE), and transferred books and the knowledge from independent individuals and institutions, to "Catholic-Orthodox" monasteries. The emperor, as Christian-in-chief, or "thirteenth apostle", controlled the monasteries, not the libraries and academies.

We also have explicit declarations from Roman emperors, centuries before the imperial imposition of Christianity, that new inventions may destabilize society, and thus emperors paid inventors to keep their inventions secret. It is not a coincidence that the time of great technological and industrial progress in Europe, later, would see so many revolutions. Progress is one whole.

Progress in Medieval Europe started as early as 1100 CE, when professor Abelard and his partisans confronted the religious fascists led by Saint Bernard. At the time the revolution had to do with the immense popularity of the cathedral schools, and their transmogrification into universities, and architecture had gone beyond Roman science (as demonstrated by Gothic cathedrals, which replaced Roman cathedrals, with the invention of flying buttresses, which embodied the forces, in particular wind loads, that the buildings were submitted to).

One could look at an even earlier renaissance: the Franks made a revolution in education, even before Charlemagne, by trying to make schooling mandatory and universal. This was the exact opposite direction from the late Roman empire. It was followed with an advancement of technology; the tenth century is “full of beans” (which Frankish biotechnology had just evolved).

Roman plutocrats blocked the evolution of society, of all of society. When they made changes it was mostly out of dire necessity and fascist control. This excluded really new methodology. So, for example, Christianism, an old style superstition was imposed, to help establish a stronger fascism than the one used by prior emperors, in the first three centuries of the Principate.

This drift towards fascist superstition was so deep that it was emperor Diocletian that established this, the emperor as sun-god, to be called "Dominus". Constantine just switched to using the Catholic church, which had an already existing paramilitary structure in place, and which rested on a cult of personality of a tyrannical father and a chosen son that could be easily translated into the imperial cult (whereas worshipping the sun was all too natural, and all too real).

Gibbons focused on Christianism, as the cause of the collapse of Rome: I explain how this superstition came about, the last nail in the fascist-plutocratic coffin. For Gibbons, Rome reached apogee under the Antonine emperors. For me, Rome started to decay when the plutocracy took control of the Senate, under the republic, three centuries earlier than the period Gibbons admired so much.

***

A FEW MEN AGAINST PLUTOCRACY: NOT ENOUGH.

One man or two could have changed everything; Caesar and Cicero knew it, and so did the plutocrats at the time. That is why Caesar and Cicero, long opposed to each other, became allies. And that is why the plutocrats were in such a rush to assassinate Caesar, who, although himself the top plutocrat (and "dictator for life"), was also the leader of the Populares, and had shown the capacity to change everything.

Correctly, Caesar decided to use the most formidable army the world had ever seen to destroy all of Rome’s external enemies, in one blow. We will never known what could have been. But, just as with the assassination of the Gracchi, and thousands of their supporters, the enormous mental force of plutocracy is not to be neglected: for one Caesar, and one Cicero, how many were ready to die for plutocracy, so much they believed in it?

When the Gracchi were confronted by armies of thugs paid by plutocrats, the later had succeeded to leverage themselves, thanks to their wealth, in controlling the republic. This control was not total, as 110 years of near constant civil war and dictatorship (such as the one of Lucius Cornelius Sulla) followed.

Verily this is how the Greco-Roman empire crashed: THE INDISPENSABLE BRAINY IMPROVEMENTS WERE NOT MADE IN A TIMELY MANNER (the same scheme happened in most other collapses of civilizations).

This would befall any civilization, lest it continually reinvents itself. Indeed, any given technology is always unsustainable, in the fullness of time. So new is always needed. That means new brainwork. That means progress, the opposite of conservatism.

***

COMPLEXITY MUMBO-JUMBO:

An Internet interlocutor called "George" replied to a version of the preceding, exhuming an historian plutocrats have been using to claim they are innocent: "Patrice, some authors (Tainter in particular) have a theory for “most collapses of civilizations”, which basically boils down to diminishing/decreasing returns on complexity.

Thus, the reason that “indispensable improvements were not made in a timely manner”, according to Tainter, is that because of the diminishing returns rule, society ran out of the ability (or willingness) to cope with the need to add on more complexity to deal with the problems caused by the accumulation of complexity.

In a sense, the ever increasing supply of energy-dense fossil fuels since the dawn of the industrial era has enabled our current civilization to more than offset the consequences of the diminishing returns to complexity – so far. But, as in the Merchant of Venice, the pound of flesh will have to be paid in the end.

George."

***

Reply: TAINTER BARKS UP THE WRONG TREE. IT IS NOT COMPLEXITY THAT WENT UP, BUT STUPIDITY:

A complexity theory of collapse has something for itself in the sense that, as old technologies exhaust themselves by exploiting what was there before, until it is no more, it is necessary to develop new technologies to replace them. So complexity rises, and always has, ever since there are men, and they think. Failure to follow that natural trend results in a crash.

But it does not seem to be the argument Tainter is making.

Tainter argues that sustainability or collapse follow from the success or failure of problem-solving institutions and that societies collapse when their investments in social complexity and their "energy subsidies" reach a point of diminishing returns. Tainter recognizes collapse when a society rapidly sheds a significant portion of its complexity.

For me, this argument of Tainter is neither here, nor there, in the real world. Viewing invasions by Germans, Huns or Mongols as "shedding complexity" is silly, although, of course factually true, since everything burned down. Sheer terror is more like it. The Mongols actually debated whether to eradicate China and change its ecology into a steppe.

Tainter’s mishmash of ideas and observations is generally viewed as meaning that: investment in social complexity are characterized with diminishing returns. In other words, Roman welfare ruined Rome. And Reagan made the sun rise over America, by dismantling the state (except the army, so Reagan could go and ruin other states too).

Tainter’s basic thesis, is a rather curious one for an historian to make. It is beyond a doubt that, by the late Middle Ages, social complexity in Europe was far above that of imperial Rome, and "returns", far from diminishing, as Tainter would have it, were well above those of Rome, and increasing. It had been so since 1000 CE.

Tainter’s picture is so simplistic that it ends up being completely inappropriate. To rehash the most well known facts is rather superficial, while invoking "diminishing returns" here and there, is an incantation which can only satisfy plutocrats. for plutocrats, it’s all about returns. The conceptual category tied to the notion of “returns”: it is that of finance, the realm of the plutocrat. Thus Tainter conveys at the outset the notion that confinement to the plutocratic realm is all we need to explain the world.

To brandish imperial overextension as a cause of decay is nothing new. Emperor Hadrian was so familiar with it, that he pulled the Roman empire out of Mesopotamia, and other places, with catastrophic military consequences, as the pressures of enemies nearly broke the empire under Marcus Aurelius. Hadrian’s unfortunate retreat would haunt Rome forever, and thereafter. It may be why the American legions are in Mesopotamia now, still trying to reestablish order, and progress, in rather pathetic way, 1,900 years later.

Complexity has to do with collapse, but not the way Tainter has it. I believe that it is the other way around from how Tainter has it. It is the incapacity to handle complexity that went up drastically, not the complexity itself (complexity always trends up, at a pulsating, but overall steady pace).

As I keep on repeating, the increasing incapacity for thinking is blatant in the Greco-Roman empire: most of the creative thinking is at the beginning, or under the republic, or even earlier in the free Greek city-states.

After a while, under the Principate, thinking completely vanishes. Centuries go on and on, and no thinking of any value is created, let alone any major new idea implemented. Rome reigned, on an intellectual desert the plutocracy had created. Far from becoming ever more sophisticated, the empire was getting always less complex, mentally speaking.

Anti-intellectual terror, though, was in full evidence: the pope Gregory the Great threatened to burn his own bishops if they taught "grammar’ to the people (the Franks shrugged, and protected the bishop of Die, who kept on teaching "Grammar", to the People).

Mental malfunctioning is how empires go down.

The Mayas depended crucially upon some particular tree species for construction, and kept exploiting them for many centuries, if not millennia. Yucatan became a vast technological garden, with a huge hydraulic network. But, in the end, the Mayas suddenly overexploited the trees they depended upon. Far from getting into too much complexity, the Mayas had forgotten the old subtleties. They had forgotten the old ways, where morality comes from, the customs, the time honored ways, the "mores". It is not so much complexity that had increased (OK, the intense drought at the time may have complicated matters), rather than the incapacity of the Mayas to handle it. The balance of power between the City-states of Tikal and Calakmul may have been disturbed by an arriviste queen from another city, around the time when the calamitous, centuries long drought struck (would I add). But it remains that the Mayas were suddenly unable to cope, because they had created a mess, instead of creating solutions.

***

DECEREBRATED BY PLUTOCRACY, ROME HAD BECOME A SITTING DUCK:

Basically, by the year 700 of its founding (0 CE), under "Augustus", the "One-Who-Augments", Rome became increasingly idiotic, and, although the situation of the empire was much simpler, it was incapable to deal with it. Rome had become idiotic because it was controlled by Roman plutocracy, and it was in the interest of Roman plutocracy to make the People of Rome (Populus Romanus) completely idiotic, thus to make Rome completely idiotic, overall.

One can control, imprison and fleece sheep, not philosophers, engineers, and poets. One of Augustus’ first moves was to throw out much of the old Senate, and replace it by one of his own plutocratic liking.

So, when NEW technological challenges appeared, confronting Rome, the NEWLY idiotic Rome was unable to deal with them. Instead, Roman technology stagnated, and society degenerated into a plutocratic theocracy… Although, recent archeology shows, the economy kept on improving (contrarily to what Tainter is claiming).

Meanwhile the Barbarians caught up with Roman technology, especially military technology: the Franks became the shock troops of the Roman empire (the Franks became the elite of the army under Constantine, 310 CE, a fact confirmed under Julian (356 CE) who was voted Augustus by the Franks, after the emperor Constantius II tried to order them to the Orient to fight the Persian Sassanids. This was a full 150 years before the Franks took control of Gallia and Germania…in the name of Rome).

After the collapse of the Roman state (not of the Roman civilization or language, but of the Roman state), technology would start advancing again, under the Franks (inventing from beans to stirrups, to horses’ collars, to massive labor horses, to sophisticate agriculture and deep plows turning the ground, to Gothic cathedrals to wind and water power everywhere; by 1000 CE, the energy Frankish citizens had at their command was the highest in the world).

In the case of Rome, it is pretty clear that the bizarre evolution of Roman society had nothing to do with increasingly complex problems.

For its first seven centuries or so, Rome was confronted to enormous, extremely complex problems, of the most extreme lethality, which looked hopeless to solve.

From the Etruscans’ colonization, to the war with the Sabines, to the invading Gauls, who captured Rome, and asked for ransom, to the brazen Carthaginian plutocratic empire, and its high tech Navy, to Hellenistic dictatorships, complete with charging elephants, to violent marauding hyper powerful German warrior nations, complete with deadly fighting women, destroying all Roman armies, but one, to the problem of getting rid of kings, and giving increasing powers to the People, to the status of the Allies, to the very complex, evolving constitution and voting systems, Rome, the Roman republic, had giant problems everywhere, and responded to them by enormously complex solutions, which were moving all over the place, as the centuries went by.

Towards the end of the republic, the situation had become much simpler: Rome was master of the world. Rome could not be killed, and actually was not killed: the Merovingian empire of the Franks (“Imperium Francorum”) replaced progressively the Greco-Roman empire (from the defeat of the last non Frankish Roman army in 486 CE, to the capture of Constantinople in 1204 CE). But the queens of the Franks spoke Latin, and did so imperially, thinking of themselves as Roman (we have some of their letters!)

At the end of the Roman republic, only three military powers could be distinguished, in the far distance. Caesar intended to solve the military situation once and for all, with one giant military expedition that would submit Persia, Sarmatia and Germania in one shot, coming from behind. Unfortunately he was assassinated by plutocrats masquerading as republicans, the day before he was going to take his leave. That assassination was a drastic collapse of the ethics of survival of the republic (since when would good Roman republicans assassinate the commander in chief, the "dictator", as he was going to war against terrible threats?)

In a few months, Rome lost it all. Marcus Antonius, "Marc Anthony", soon boyfriend of Cleopatra, nailed the hands of Cicero, lately allied to his master, Caesar, on the doors of the Senate, an unimaginable gesture, prior, when Rome was a republic.

What had collapsed was ETHICS and morality (mores = customs in Latin). After that, the ruin of the empire was just a matter of time. The situation was simple in all ways, EXCEPT in the ethical realm, where plutocracy reigned on minds and society alike.

***

WHEN DID ROME COLLAPSE?

It seems to me that Tainter does not know Roman history as well as his ambition demands.

A first problem is when did the “Roman collapse” occur? Collapse of what? The Roman republic? Was the collapse when Octavian ("Augustus") became Prince ("Princeps"), or half a millennium later, when the last Western Roman emperor reigned in Rome, or in the Seventh century, when the Roman Senate disappears, or when, in 846 CE, the Muslims sieged Rome and occupied the future Vatican? A Frankish army chased the Muslims away.

Tainter, of course, gives the conventional answer: Rome collapsed when the last emperor was deposed in the West. But that was just a detail: Theodoric would soon be Roman emperor there, in all but title, and the Roman Senate would go on for more than a century. The last certified Roman emperor visited Rome in Meanwhile, in Gallia, Clovis, son of his Roman imperator of a father , was made Consul. Roman Consul. As far as the Franks were concerned, they were Rome. They never collapsed. And Roman emperor Justinian did not attack them, when he retook control of the entire Mediterranean (but for the shores that the Imperium Francorum controlled). This was in 554 CE.

The collapse of Rome is a very mysterious subject, because the more one looks at it, the less one sees it. Just another example: Otto III, crowned in Rome in 996 CE, as “Holly” Roman emperor, made Rome the administrative centre of his empire and revived elaborate Roman customs.

Otto III was a successor of Carlus Magnus, "Imperator Romanorum". A bit earlier, in a joint land-sea operation, the Frankish army and the Byzantine (= Roman) Navy had crushed the Muslims in Provence, with a final sea battle in the Gulf of Saint Tropez, where the Gregian fire was used, with its usual success.

That is why I go back to the point when the ethical collapse of the republic started, when the plutocrats of the Roman senate had enough clout to impose their destruction of (by then) democratic Carthage and the free Greek City-states (including Athens).

***

COMPLEXITY SOLVES PROBLEMS, STUPIDITY DOES NOT:

Much earlier, when confronted with intractable military problems, the Roman republic invented new military technology: Spanish short sword, to make short work of the phalanx, from the side, javelins that one could not be thrown back, sure to stay stuck in the enemy’s shields, advanced metallic armor, ballistics, and so on. Carthaginian ships were captured, and duplicated, etc. Confronted to huge ocean going Gallic sailing ships, the Romans invented a way to seize their sails. Having to feed the cities, they built a giant trading system, with aqueducts using waterproof cements of their own making. And so on. Republican Rome was a plethora of new high technology.

Under the empire, although it became obvious that further technological progress was needed, economically, energetically and militarily, the emperors deliberately made an anti-invention policy, paying inventors to NOT invent. Because, they said, inventions would increase unemployment (meaning: make plutocracy unstable). Interestingly the first industrial uses of water power occurred in Roman Gaul (where technology would soon blossom under the Franks, because the Franks had not enough slaves, having outlawed slavery for Christians and Jews).

The mind solves problems by augmenting complexity. Just look at physics, mathematics, and biology. Our present theories are certainly more complex, and more powerful, than ever before. Our present societies are also more complex, and that very complexity allows them to solve more. Where has Tainter been?

***

IS ARROGANCE, OVER EXTENSION, AND "DIMINISHING RETURNS" THE PROBLEM?

Another observation from a reader was this: "@ Patrice Ayme: The Greco-Roman Empire crashed from their over indulgence of arrogance. They partied hardy on the laurels of the past. Sounds familiar? Technology had nothing to do with it, but the over extension of Roman armies into lands that were plunder-less from past plundering. They killed the “Golden Goose”, period! This parallels the United States too… with our perennial Viet Nam, Iraq, Afghanistan, and Iran… if the Military Complex War-Mongers can get their way… wars accomplishing nothing, but moving us closer to the precipice of financial ruin! I ask you to question yourself – have America’s leaders become arrogant, and drunk with hubris?

Earle, Florida"

***

To which I reply: FACTS ARE HARD, PLUTOCRACY IS HARDER:

It is true that the present day USA is insufferably arrogant. Even criminally so. And it is true that insufferable arrogance, obvious in the speeches of Pericles, led to the downfall of Athens.

The "plunder-less" theory comes straight from Tainter. It is central to its "diminishing returns" concept. Many provinces of the empire thrived for centuries, as long as the Barbarians did not show up. Thus, that the empire stalled from lack of plunder is not supported by detailed evidence of the history of Rome.

Instead, Imperial Rome was imperially incoherent, because it was led by mentally small people, preying on each other. The plutocratic leadership worried more about other plutocrats rather than about Barbarians, or the grandeur and future of Rome.

Having suffered a severe defeat there, Augustus told his successors to leave most of Germania alone. But that left a frontier with a high fractal dimension, impossible to defend, precisely what Caesar wanted to fix. Finally emperor Carlus Magnus, ‘Charlemagne", completed that conquest, doing part of what Caesar wanted to do, a short frontier on the other side of Eastern Europe. Thus Charlemagne, following Caesar, created Europe, and the Romans did not. Although, of course the Roman army, was gigantic, getting to as much as 800,000 men in the Late Empire. But it was going nowhere. It was a sitting duck, with rusting technology.

Arrogance is not very much in evidence in the last few centuries of the Roman empire. However, the Romans were extremely arrogant, wrapped as they were in a strong legal and ethical system under the republic, and it worked well for the republic. It was the arrogance of superior morality. Generals who could put their hand in the fire, and stayed unmoved. By contrast, Rome became a mess under the empire, and moral arrogance went down as confusion went up.(This seems to support Tainter’s thesis, but not really, once one looks in the details).

There are other character flaws besides arrogance, and the Romans , or more exactly the Roman plutocracy that ruled Rome during the empire/principate, accumulated plenty of these. Cupidity and greed were foremost. The empire was not only ruled by the richest, but its soul was guided by Pluto. This is the crucial point: it’s not just about wealth, but the nastiness to enforce it.

Technology, or rather the lack of drastically new, adapted technology, played a huge role in the down-going of the Greco-Roman empire.

First of all, of course the technology of political organizations (“political science, economics”) became simplistic in the empire/principate: an emperor seized power, and the army vowed to obey him. Or the army would chose an emperor, and then try to impose him. That was ridiculous simple, politically speaking, relative to the enormous complexity of the republic (with its various chambers, assemblies, responsibilities, duties, voting system by "tribes", balance of powers, powerful judiciary).

Plutocracy also voided Rome, and Italy, of all and any control on its destiny (putting millions on the dole, and making them impotent economically and militarily, before outright switching the capital out of reach, all the way to the way to Asia; Romans, and later Italians, were forbidden to serve in the army).

More important for the loss of military control, was the disappearance of a technological edge in armaments. Instead, the Barbarians acquired the edge. Composite bows used by the Parthians, and then the Huns, threw arrows that could pierce Roman armor. The economic technology also faltered: unexploited land grew (from the end of small farming by independent owners, another device deliberately imposed by plutocracy, because small land ownerships had been given backmany times in the republic, with land redistributions). The mines with their indispensable metallic ores became unprofitable, from a dearth of slaves and difficulty of extraction.

***

AMERICAN INSANE SLIDE IN THE MORAL ABYSS, WHERE PLUTOCRACY WANTS IT:

Where does the West stands as a comparison to Rome’s slide into the abyss? Well recently, the leader of the USA, in perfect tuxedo, joked, as a stand-in comedian, to great laughter among the worthies of the main stream media of the USA, about "predator drones".

"Predator drones" bomb people, far from battlefields. Hundreds, if not thousands, of innocent civilians have been killed in these strikes (the military of the USA is now careful to hide that tragedy, at least from the public of the USA). Also we learn that orders have been given to kill an American born citizen who is a Muslim cleric, who just speaks with a bad tone of voice. Now, it’s not in my habits to defend Muslim clerics (see P/S).

Inasmuch as I detest Muslim radical literalist fundamentalism, I do not believe that it necessitates to throw out the foundation of Western civilization. Indeed we are in a state of law, not in a state of assassination. Supposedly, the government of the USA has decided that this cleric, apparently hidden in Yemen, was putting out too effective of an anti-American discourse. So what the government of the USA is now saying is that American born citizens can get killed purely for their ideas. And with no more due process than some administrative decision.

Now I am not naïve, and I do believe that assassinations have their place, and that secret services (under the threat of prosecution), should have some latitude to do so, after presidential approval, as needed (under Mitterrand, in France, a few foreign agents were selected for assassination, each year).

But the mental process that is going right now in the USA is completely different. Declaring that American born citizens can be killed, just because of what they say is going back to the sort of morality the plutocrats who opposed the Gracchi displayed in Rome: WE KILL YOU, BECAUSE, YES, WE CAN.

This criminal arrogance is moral collapse, hence collapse of the republic. Of the American republic. This is exactly how Athens collapsed; it exterminated a City-State, for no good reason, but sheer hubris. Of course, the other 200 Greek City-States felt immediately more inclined towards Sparta. Similarly, moral collapse, of a less brutal type, happened also in Rome.

More than five centuries before the Visigoths seized the eternal city (410 CE), Roman morality had started to collapse. And then progress was set in reverse. Similarly, indications of American moral collapse are everywhere. The hypocrisy has got so colossal that it is obviously there to produce giant red herrings behind which to hide reality, not just the truth.

***

GIVE ME RED HERRINGS, AND I WILL SEE PINK:

An example of the distortion of reality is the contrast between the treatment given to Polanski, and that of the torturers of the USA. Polanski is an Auschwitz survivor whose life was broken in Los Angeles when his eight and a half month pregnant wife, Sharon Tate, was tortured to death by the Charlie Manson gang, having pieces of her body removed while alive. Polanski’s child also died. Polanski has spent many months in prison for a sex charge, consensual "unlawful sexual intercourse with a minor" (her own mother had sent her unsupervised daughter to Polanski for a second photographic session in Jack Nicholson’s home, 34 years ago; see P/S).

In the USA the obsession with Polanski is sky high, all devouring. If you get indignant about Polanski, you are a citizen in good moral standing. If not you do not, you have got to be, well, French, like Polanski, or Bernard Henri Levy (Polanski’s philosopher friend). It will remind Europeans of the old American obsessions with "sodomy", and inter-racial sex. Both used to be unlawful, both allowed to perform very nice lynchings. Not that I approve of Polanski’s deranged act, but neither do I obsess about it, in these times of unlawful wars, predator drones, official torture, and citizens’ assassination for speech crime. The obsessors want to obsess, though, because it allows them to forget about the rest.

Ominously, prosecution against Polanski heated up while he finished his excellent latest movie, "Ghost Writer". "Ghost Writer" accuses the USA to be a giant conspiracy of quasi infinitely malevolent hypocritical lowest of the lows, shrouded in American academia.

In that movie, the ex-British Prime Minister has fled arrest for war crimes by European justice in one of these islands for the rich off Massachusetts. The ex-British PM has lived his life as a puppet of a murderous plutocratic world plot centered on Harvard University, and American secret services, serving, well, the plutocracy. As the Harvard/US Secret Service conspiracy gets revealed, inquiring minds get killed, and nothing is left of them in the end, but papers in the street, torn by the wind.

While Polanski get prosecuted and imprisoned, the advocates, theoreticians and implementers of torture in the USA are honored and empowered. One is a university professor (at UC Berkeley) and the other is a Federal judge (in San Francisco, an extremely powerful job). They are both based in the San Francisco Bay Area, supposedly the most liberal place in the USA (imagine what would happen to Polanski in Los Angeles: torture, execution?). In other words, in the most liberal place in the USA, the theoreticians and enforcers of government torture thrive. (Code Pink is trying to change that, but not yet.)

"Ghost writer" is not just on the screen. It’s on main street. It’s in Wall Street. And, say Polanski, it’s in US academia. I have myself long attacked Harvard as a center of an immense plot, an erroneous vision of subjugation. Many things thought to be archetypes of Nazism were directly adapted from Harvard, including songs, because at least one of the most important leaders of the Nazi party was from Harvard. Lawrence Summers, the dismantler of Franklin Roosevelt’s Banking Act of 1933, the main creator of metastatic finance, was president of Harvard, until his grotesque sexism drove him out.

Another growing obsession has been the "Tea Party". Those people consider Obama a "socialist", because of his health plan (which is very friendly to the hyper rich… although much less friendly than the status quo). The Tea Party claims to represent the People, but the situation is reminiscent of what happened with the Nazi Party; People’s rage, plutocratic service.

Meanwhile the worst financial manipulators who ever were (most of the top of the American financial system), some demolishing currencies (after a plot: George Soros), some demolishing countries (Goldman Sachs and its paid prostitutes, the rating agencies), are left free to keep on with their self serving, world destroying conspiracies, while using fresh public money to do so, offered to them by their generous accomplices in government.

We have seen decay and rot, it starts with the head.

Fortunately, the USA is not in the situation of Rome. The People of USA is not alone, facing a mad plutocracy, as the People of Rome was.

Europe, differently from Greece when Rome attacked it, is strong, and not just militarily. Moreover, Europe was brutalized by fascism and all Europeans know that fascism was related to wealthy manipulators, and have stayed vigilant. Hence the brutish stupidity of the attacks by the plutocracy against the European Union. This time, though, there is no Mussolini, Hitler and Stalin to help. And fortunately, the president of the USA, Obama, played a positive role, telling Chancellor Merkel to do the right thing (Franklin Delano Roosevelt had not played enough of a positive role during the powering-up of Hitler). Obama apparently knows that the USA is better with a strong EU than without it. Progress of one, but progress of the most important one. So there is hope. But it’s going to be a jolly fight.

I view literal fundamentalist Islam as a personal enemy, although I do understand its usage by freedom fighters, and although I am quick to point out, that, for decades, it is American secret services, and the imperial machines of the USA, which have been the greatest promoters of this extreme superstition, which enfeebles the minds, just what plutocracy is always looking for in its enemies. This is so true, that it is starting to be known. Some people in the Middle East and Pakistan even believe that bin laden, in full accord with his ex-employer, the CIA, set-up the 9/11 attack, to give a reason for the USA to invade the Middle East. Although I am more than willing to attack the superstition, and I recognize the necessity of combat against armed enemies to neutralize them, I draw the lines at people who just think, or just talk. Those should not be touched.

What of fighting words? Well, they can be prosecuted, but first they should be denounced and interdicted. This applies to covering women under a tent on account of their gender, a form of threatening, fighting communication.

***

P/S 2: WHO IS THE MOST SEX CRAZED?

Following his indictment on one sex charge, Polanski agreed to a plea deal that spared him prison time (he had spent about 45 days in jail during a court-ordered psychiatric evaluation, halved for good behavior). But when it seemed that a Superior Court judge might not honor the deal–and sentence Polanski to prison–the director fled the country. After "Ghost Writer" loomed in the distance, and the thoroughness and independence of American justice came into question, in matters such as unlawful war, torture, and the subjugation to financial criminals, it was time to beat the sex drum. As if one old guy having had some sort of sex with a minor, compared with the death, pain and suffering of 250 million people in fear of "predator drones” throughout Iraq-Afghanistan-Pakistan-Yemen. But in the USA, it does.

Abstract: Officials from some countries which have not contributed much to civilization in the last few centuries, have clamored for the "return" of artifacts, sometimes millennia old, which they claim their countries, or should we say their nationalisms, truly own. An example is the flamboyant Dr. Zahi Hawass, secretary general of the Supreme Council of Antiquities in Cairo. Hawass, asked for the return of Nefertiti, and of the Rosetta stone, among other things.

The major museums are the guardian of the temple of world civilization. The fact that they shelter artifacts far from where they originated has both an educative effect, and a protective function. Perfect copies can be attempted, and that, itself, will have a scientific benefit.

The tribal will for the return of archeological finds is exactly the sort of respect for primitivism that the real respect for civilization condemns. It is exactly what the museums were fundamentally built to fight.

***

TO DOMESTICATE, MOLD THE MINDS:

May First passed by. It is celebrated worldwide, with a vacation day. Worldwide, except in the USA, that is. For the citizens of the USA, May 1 is the day after April 30, and before May 2.

In truth May 1 was started by American unions as a day to force the demand for an eight hour work day. It was repressed in blood and martial law. Union members were picked up, arrested and executed, in a conspiracy of "justice" and plutocracy. Then the American plutocrats buried the very memory of what happened.

In France too, deaths happened, connected to May 1, but it became an official vacation day in 1947 (it had become so in the USSR in 1922, and so it is in China). After the 1894 Pullman Strike caused the death of 13 strikers had the hands of US Marshalls and 12,000 army troops, besides about ten billion dollars in damage, President Cleveland did not want to align a US labor holiday with existing international May Day celebrations thus stirring up negative emotions linked to the Haymarket Massacre in Chicago (in 1886). Then again, unionists were picked up and executed.

Nowadays, if one evokes those events with proper US citizens, they will look back as boiled frogs, resenting and despising your lack of patriotism and exuberant over-intellectualization. This makes the American citizen the ideal collaborator to Goldman Sachs: work for Goldman eight hours a day, get nothing in return.

Americans need to visit a real labor museum, to get to know what real labor was, through its history, and resist plutocracy better.

***

RESPECT IS MORE THAN A PROPER BURIAL:

Respect comes from re-specere, looking back at someone, in Latin. It does not mean burying someone. It means looking back.

Those who want present and future generations to remember the holocaust Nazism led to, work to save the Auschwitz death camp. It is not because Nazi haters have become Nazi. It is because they want people to keep on looking at Nazism. Denial is achieved by not looking at the crime. Respect means to look at it again.

European civilization’s power rests on knowledge, and the later is greatly helped by the so called "open society".

The European civilization model was so successful that it has been adopted worldwide, and voluntarily by India and Japan. China is trying its best to shake off 26 centuries of Confucianism torpor to adopt it too (and, in some important respects, is overtaking Western Europe itself on its own model, with, for example, tremendous efforts in directed, planned economy and renewable energy).

It is important to keep the foundation of that European civilization in good order. Gratuitous appreciation of esoteric knowledge is such a foundation. Curiosity is found in naturally raised animals, and European civilization makes a point to encourage it. It’s the opposite of a knowledge-only-if-you-need-to-know civilization.

Let’s point out in passing that I use the word "European" in the modern technical sense, as invented by the Franks in the Eight Century (8 C). It first appeared to inform us of the defeat of the Saracens ("followers of Biblical Sarah")… by the "Europeans" (see note).

The idea of the "open society", is often associated to the name of the 20 C philosopher Karl Popper, but it actually comes from a much more, all too much more, exuberant philosopher, Pericles, Athens fateful leader. And is charged with a sinister hubris.

Pericles and his philosophical advisers knew much, but, it turned out, too much fluffy stuff, and not enough serious stuff. They did not govern with the worst possible case in mind, as serious statesmen always should. Instead they peacocked around, crowing about Athenian greatness, uniqueness, and never before seen glory, exactly the mood that worried many Greek states, which did not appreciate the unfair rise of the Athenian superpower.

Pericles and his philosophical advisers miscomputed (I will say, after considering carefully the spin Herodotus puts on the whole thing in one famous sentence I find misinformative). Their powerful, but brittle, knowledge led the Athenian republic to shatter in a catastrophe, and full democracy was brought back to Athens, by other Europeans, only 24 centuries later. The overall flow of civilization may have been delayed by a millennium, or more.

Pericles and his philosophers knew many things; they knew enough to fly the plane around, but not enough to avoid crashing it. They should have visited more museums. Of course museums did not exist yet. "Mouseion" , "a seat of the muses", meant a place of study in Greek, and was initially directed at the university in Alexandria (established much later).

Museums play an important role in the expansion of knowledge. They are places where knowledge, especially distant, shocking knowledge, is exhibited, in a quiet spirit of importance and reverence. That is why countries such as Abu Dhabi, anxious to regain a place at the top of civilization, are opening massive museums.

However an increasing number of countries have asked for the "return" of archeological finds and the like. I am going to explain why this is all wrong.

***

EDUCATING AMERICANS: FRANKLY BETTER:

Let’s considers the "Cloisters" in New York City:

The Cloisters house the Metropolitan Museum of Art’s collection of art and architecture from medieval Europe. Best known for the beautiful tapestries on display, the Cloisters also offer architectural installations, a series of special programs, and fantastic views of the Hudson.

"Located on four acres overlooking the Hudson River in northern Manhattan’s Fort Tryon Park, the building incorporates elements from five medieval French cloisters–quadrangles enclosed by a roofed or vaulted passageway, or arcade–and from other monastic sites insouthern France. Three of the cloisters reconstructed at the branch museum feature gardens planted according to horticultural information found in medieval treatises and poetry, garden documents and herbals, and medieval works of art, such as tapestries, stained-glass windows, and column capitals. Approximately five thousand works of art from medieval Europe, dating from about 800 CE with particular emphasis on the twelfth through fifteenth century, are exhibited in this unique and sympathetic context."

One of the tapestries is the "Hunt for the Unicorn", made of 101 panels, a French national treasure for centuries, looted during the French Revolution, and purchased by the Hitler supporting plutocrat, J.D. Rockefeller, who put it in his apartment.

Shall France ask for the return of the" Cloisters"? Of course not. Why? Because, in France, "le ridicule tue"("ridicule kills"). Nothing prevents the French state or individuals, to give artisans the occasion to make perfect copies. France has more to gain teaching the Americans where they culture comes from, than to vengefully grab it back.

***

BURY MAORI CULTURE, IT’S TOO HORRIBLE TO LOOK AT:

The Maoris of what is now called New Zealand used to preserves cut heads of enemy warriors. They were adorned with wonderful tattoos. There was a flourishing trade of these heads among Maoris for centuries, and, worldwide, among collectors, in the Nineteenth Century. Now "New Zealand" has asked "France" to return them, allegedly to bury them.

Drawing released by Rouen city hall showing a mummified Maori warrior head.

This mummified and tattooed head was to return to the Te Papa Tongawera museum in Wellington following a decision by the mayor of Rouen, where the head has been preserved for 130 years. But France’s culture minister Christine Albanel blocked the return arguing that the mummified head was now part of French heritage.

The city of Rouen grandly declared that it "maintains its objective, despite the judicial twists and turns, of returning this human head to New Zealand so it can be buried in dignity and with respect to the individual."

Dignity? Respect? This is unreal: said individual no doubt approved of cut off heads, and may have been happy to be shown around. Maoris had a different value system, a very different culture. They ate each other. Respecting ancient Maoris is to do as they, the ancient Maoris, did: understanding why that was a good idea, to trade heads and cook bodies.

To "respect" ancient cultures by enforcing upon them what we mean by "respect" now, is no respect. It is no respect for them, it is no respect for history, it is not respect for man, it is no respect for nature, it is no respect for logic. It is deeply disrespectful, it is an attempt to bring the grandeur of man down to Mickey Mouse.

Instead of respect, all what a Disneyland approach to memory will do is to bury humankind’s collective memory. Indeed, what is next? Returning for burial the lampshades made of human skin by the Nazis? Because they offend the dignity of man? Well, what offends the dignity of man is to claim that it is not what it truly is.

***

CHRISTIAN BURIAL, AND CHRISTIAN EVERYTHING, RULES:

Among Maoris, as in all ancient societies, mayhem was how population was controlled. However, slavery as a prisoner was apparently more feared than being killed and eaten.

A Maori living in England in the nineteenth century used a biological argument in favor of human food delivery: "The fish of the sea eat one another, the large fish eat the small ones, the small ones eat insects; dogs eat men and men eat dogs, while dogs eat one another; finally, the gods devour other gods. Why, among enemies, should we not eat one another?"

The main effect of museums is to point out that emotions such as beauty, dignity and duty do not have a fixed meaning. Maoris did not bury their enemies. They ate them. OK, they buried them in burning pits lined up with scalding stones, covered them with leaves, and soil, and waited until they were well done. Heads of enemy chiefs were given back after peace treaties, and there was a commerce in heads.

As Captain Cook was told by Maoris: ‘Can there be any harm in eating our enemies, whom we have killed in battle? Would not those very enemies have done the same to us?’ Cook even made a little experiment, he admitted, witnessing human cannibalism of Maoris, on Maoris. Somewhat ironically, the commander himself ended up killed and ceremonially baked in Hawai’i, in a later expedition. Cannibalism was practiced throughout Polynesia (with the possible exception of the Chatham islanders, who were promptly eaten by Maoris once the latter took command of two British ships with the deliberate aim of eating said natives ).

Nowadays some will argue that the descendants of Maoris of old are Christian, and they aspire to have their ancestors buried, as good Christians do. But to agree to that is to agree that what are arguably the most significant remnants of the old Maori culture ought to be buried with them. It is to acquiesce to a Maori cultural holocaust (holo-caust = whole-burn; see note on word "holocaust"). Ancient Maoris would have eaten most Christians if they could get away with it, and use the rest as slaves.

***

DOES EGYPT WANT TO DESTROY NEFERTITI?

So it is in many places: opportunistic managers make claims that their "ancestors’" remains, or works, ought to be returned. Egypt want many works to be returned. Nefertiti’s head is in Germany:

A German archeologist discovered Nefertiti’s bust in 1912. He would have described it as less than the important discovery she was (Nefertiti was wife to the Pharaoh Akhenaten who imposed monotheism on Egypt). Thus the Egyptians have asked for its return, claiming that its departure was fraudulent. Chancellor Adolf Hitler refused the return.

But the Egyptians still want the return of Nefertiti, although, in the meantime, they were imposed, and more recently adopted, a state religion which is deeply antagonistic to old Egypt’s basic values (which gave rise to many of the values of the West).

So now Egypt is a dictatorship where last year all pigs were killed, supposedly because of the flu, but truly because Egyptian Christians lived off them. In Cairo alone 300,000 pigs were executed. The Christian garbage collectors have lost half of their income and now biological waste is piling up high (because there are no more pigs to eat it).

One can easily imagine what the strict Muslims want to do to Nefertiti’s head. In strict Islam you can’t represent human figures. It’s even worse than that: Muslim obey the Qur’an, but also the Sunnah (= "usual custom, habit"), another book of gossip about the life of Muhammad (Peace be Upon Him, He Needs It).

In the Sunnah one finds that according to the following "Saheeh Hadeeth" (= "Authentic Saying"): “Every image maker will be in the Fire.” And Muhammad (peace and blessings of Allaah be upon him) also said: “The most severely punished of people on the Day of Resurrection will be the image-makers, those who tried to imitate the creation of Allaah.”

That includes making images of animals and birds. Thus, logically Muslims ought to destroy Nefertiti’s bust, out of respect for Muhammad. So why should it be returned to them? Why don’t they make a copy, and worship that instead? Or destroy that, instead?

What about making copies of the giant Buddhas in Afghanistan? (The Buddhas were dynamited by the Taliban; the Buddhas were carved centuries before the invention of Islam, but they were images of animate creation of Allaah, thus to be destroyed.)

***

I COPY THEREFORE I LEARN:

The Greeks want the British Museum to return Parthenon sculptures saved by Lord Elgin around 1800. It was a time of war in Greece, and more was to come, as the struggle for Greek independence had (re)started. The Parthenon had been transformed by the Turks in a gunpowder store when it blew up in 1687, during a war with Venice (one of many). But contemporary Athens has horrible pollution, which eats limestone like candy. Why do not the Greeks make exact copies instead? Too many Greeks are not working, cashing on their average retirement at fifty-three years of age? (Copies have been made of other parts of the Parthenon, and installed to replace the devastated originals, so it’s not like it would be something new.)

In general, exact copies of important works are a good idea, especially in dangerous areas. Thus France made a copy of the Lascaux cave next door (or rather in the next cave). A lot of antiquities have been saved only by miracle, as Lascaux was for 17,000 years.

Lascaux was discovered in 1940, and had to be closed by 1963, because the CO2 from 1,200 visitors a day damaged the paintings (now only scientists can come in). Thus, copies are better. Burying and destroying antiques, as some want to do with heads preserved by advanced ancient Maori technology should not be tolerated.

***

LINGUISTIC RAGE:

Meanwhile in Belgium, some Flemish speakers are driven to rage and frantic exclusionism by the existence of the French language in their neighborhood. This is the sort of ugly European nationalistic passion the average European has every right to never want to see again. Indeed the ancestors of these Flemish and French speaking people have lived next to each other for millennia. The ancient Franks spoke actually a variant of Dutch, learned Latin and created French. So contemporary Flemish speakers have to the French a similarly unevolved situation to that of the Chimpanzee relative to Homo. No wonder they are angry about something they don’t understand.

The loud calls for the return of whatever which is totally foreign to those who clamor for its return, or howls of exclusion for the language next door are examples of nationalistic madness.

Nationalism is madness, because it leads to death. It’s all about the obsession with what one wants, with what one had, the dislike of the other, the desire to take back from them, whoever "they" are, just because one can, on some specious ground, and the more specious, the greater the rage. It’s all about giving in to rage, hatred, the will to war. It’s all about not having visited enough museums, with enough diversity inside. Of these sorts of childish rages, fed by intolerance, the greatest wars have been made. They can last a long time.

***

JEWISH FANATICISM, OR HOW TO DIE FOR SUPERSTITION:

The war of Jewish fanatics against Rome in Jerusalem launched a huge chunk of civilization down a blind alley. Innocuous enough it looked to start with: Jewish nationalists surprised and massacred 600 Roman legionaries of the Jerusalem garrison. Israel had been a Roman protectorate for decades, and Jerusalem had prospered, the temple had been (re)built on a gigantic scale.

The Jews of Alexandria to the west, much more numerous, and more civilized, did not follow the rebellion in Jerusalem. Instead they cooperated with the Romans. Soon Jewish fanatics in Jerusalem were also fighting each other. The legions bombarded Jerusalem with thousands of pig heads’ to make fun of the Jewish superstition against pigs. Soon the top Jewish general and priest, having been made prisoner in battle by the Romans, befriended the Roman emperor and his son, and would inherit from them.

The war ended with the destruction of Jerusalem and its Temple in 70 CE, and a million dead, inciting an irreparable breach between the Pagan government and perceived Jewish fanaticism. It was also a very bad example for the Christians, who proceeded to apply Jewish fanatical methods to all their enemies, real or imagined. It also created a breach between the Christian Roman government and Judaism, which then extended to even greater heights with the Muslims after the creation of Islam. And then turned into outright racism against the Jews, first from the Christians, and then from the Muslims. And here we are.

The Palestinian-Jewish confrontation is, first of all, a cultural phenomenon founded on unwarranted respect for past religions and their attached superstitions. Museums are an excellent place to learn and compare beautiful, but totally insufferable, and intolerable past superstitious religions and practices.

***

MEET OTHER CULTURES, SO YOU LEARN:

At the time (196 BCE) when the Rosetta stone was carved, Egypt was ruled by Greeks playing Pharaohs. The stone is written in Greek, and old Egyptian languages. It was found when French scientists dug deliberately in the foundations of an old fort in 1799. Brought to London in 1802, it was later deciphered by the French scientist Champollion, giving the first translation of hieroglyphs. England sent a replica of the stone to Egypt. Hence the Rosetta stone is itself a symbol of the multi civilizational reality of our world.

We need more understanding, and thus more artifacts for the young and wise to contemplate, from far and away in space and time, and culture. Theft of artifacts ought to be repressed by law. But past acquisitions by reputable governmental, or quasi-governmental museums, or acquisitions under contracts, ought to be beyond any suspicion.

***

PA

***

Note on the word "European": Before the 8C neologization by the Franks of the word "European", "Europe" denoted continental Greece (by opposition to the Greece of islands and the Ionian coast on what is now Turkey). The word comes from Semitic language such as Phoenician, and meant, "to the west".

***

Note on the word "holocaust": The word "holocaust" is charged with meaning among the simple, for whom it means the six million Jews killed in WW II (6 million has been contested, by the way) out of 75 millions, killed during said war. This is of course deplorable for the dozens of millions, and their survivors, who were innocent and died just as much as Jews did. The Jews did not start the war, either: their role was not heroic, and actually Hannah Arendt, herself a German Jew, accused, correctly the Jewish Councils to have collaborated with Hitler (and they did). France, and her empire, was the force blocking Hitler, and suffered, all together, two million killed.

Restricting the concept of "holocaust" to Jews means that the Europeans did not commit any holocaust, but that one. In any case, Jewish culture was not annihilated (just the Judeo-German one called Yiddish). But Maori culture, arguably, has been much more annihilated.